How is each party’s share of Family property calculated in Alberta?
In Alberta, the division of family property in the event of a divorce or separation is primarily governed by the Family Property Act (FPA) and, in the case of legally married couples, the Matrimonial Property Act (MPA). The key principle under these laws is that assets should be divided fairly, which often translates to an equal division. However, the concept of “fairness” can sometimes necessitate an unequal distribution depending on the specifics of the case.
Categories of Property in Alberta
- Matrimonial / Family Property: This category includes most assets and debts accumulated during the marriage or common-law relationship. It encompasses a wide range of assets like the matrimonial home, vehicles, investments, pensions, business interests, and household goods. Importantly, any increase in the value of assets owned before the marriage is also considered part of the matrimonial property.
- Exempt Property: Certain assets are exempt from division. These typically include property owned before the marriage, inheritances, gifts from third parties, proceeds from personal injury lawsuits, and insurance proceeds. The original value of these assets is exempt, but any increase in their value during the marriage is subject to division. Courts require evidence to confirm the exempt status of these properties, and the division of the increased value aims to be just and equitable.
Division of Property Process in Alberta
- Disclosure of Assets: Parties are required to disclose all their assets, which are categorized as family property, exempt property, and the increase in value of exempt property. The Court assesses the value of these properties to decide on their division.
- Equitable Distribution: While an equal division of assets and debts is common, courts follow equitable distribution rules. This means the focus is on a fair division rather than strictly equal. For example, if one party has wasted marital assets, the court may adjust the division to compensate the other party.
Factors Considered by the Court Regarding Property Division in Alberta
In determining a fair division, the court considers various factors:
- The duration of the marriage or common-law relationship.
- Contributions made by each partner, including homemaking and parenting duties.
- The financial situation of both parties.
- Tax implications of transferring or selling property.
- Any existing agreements or court orders impacting the spouses or partners.
Division of Debts in Alberta in Property Division
Debts are also subject to division. Generally, debts incurred during the marriage are divided equally, regardless of whose name they are under. This includes both secured (e.g., mortgages) and unsecured debts (e.g., credit cards). If a debt was incurred outside the marriage or common-law relationship, the court may decide on an unequal division of that debt.
The division of family property in Alberta aims for fairness, taking into account the entire scope of assets and debts accumulated during the relationship. It’s a nuanced process, often requiring legal assistance, especially in contentious cases. The ultimate goal is to ensure an equitable distribution that reflects the individual circumstances of each case.
